In sales you would be wise to understand what bartering means and what negotiation means and then practice the skills of both;
Negotiation is about reaching an agreement and in sales its always about a 'win:win' outcome. 'win:win' simply means that both parties gain what they would regard as the 'best value' outcome for themselves and who they represent. Its important to remember that value is percieved so a good negotiator will get what they want, a great negotiator will make sure the other party also feels they have exactly what they want too but without conceding the value of their own gain. To be good at negotiating you need to prepare to barter. To be able to barter you need to understand what you perceive as valuable and what your customer percieves as valueble.
Bartering is to trade one thing for another. Many people might think that the swap is for price against goods. However there are a number of variables which you can use in bartering. The most obvious variable can be price/cost, volume/quantities but there are many others that can be overlooked in preparation for a negitiation such as: Logistics, training, POS, marketing and sales literature, payment terms, repeat business. Its important to remember to consider where the market place is when you are gathering variables to barter. For example price might have carried more value over 'being seen as green' to some customers, when the economy was against them but when the economy becomes boyant again, those same customers might change their percieved value of the same variable because it might now be more affordable to be 'green'.
So if you want to be great at negotiating here's some tips to help you havea good plan before you meet to 'seel the deal!'
1. Everytime you discuss your products or services with the customer or potential customer, aim to find out what your customer values currently. You will know this because it will be for those reasons that the customer is speaking to you. If its not clear, ask again 'what is most important to you rght now with regards this ....your service or product?'
2. Know what your key aims are. Which variables carry the most value for you. This will depend on margins, targets, stock, resource, timescales etc. Then match them against your customers wants or top value variables (from point 1), so you have a like for like list of variables. When I say 'like for like' I mean like for like in value. If you value margin as a top priority for you and the customer values delivery on time as their top priority then you should be prepared to trade these. For example, if the customer wants to pay less than quoted, then they need to be prepared to forfeit the delivery time. In most cases you can prepare a sliding scale for each variable. For example: For 1% price reduction you would like the customer to settle on a staggered delivery timescale or a larger proportion stock intake early.
3. Know what holds little or no value to you and understand what you can still build value into for the customer. i.e. you may not yet have spoken about on going long term training for the customers end users of your product. This is a valuable service you may be able to offer at little cost to you and your business, but it could mean a great deal of value to the customer. Hence this is a great variable to build value into before you start to negotiate. So be prepared to pick up the phone and ask the customer if they would like to consider this service that you offer before you go to negotiaons.
4. know your walk away points. i.e what will you not move on and what will you not go as far as. In the same way know the customers walk away points. Ask them when you ask whats important to them, which aspects are 'deal breakers'.
5. if you plan you will be prepared to 'win'.